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Friday, June 12, 2015

Pensions bill 'a threat to UK surplus': Office for Budget
Responsibility warns Osborne spending on ageing population will push
Britain back into red without further cuts

OBR says ministers could be forced to abandon the ‘triple lock’ which pushes up the value of pensions

This week Mr Osborne announced intention to pass legal requirement to run budget surpluses under ‘normal’ economic circumstances

But OBR warned government will quickly go back into the red in coming decades because of extra costs from older people

George
Osborne’s plans to force future governments to spend less than they
raise in taxes was dealt a blow by the spending watchdog last night.

The
Office for Budget Responsibility warned thatthe ageing population and
generous pensions spending would push Britain back into the red without
further swingeing cuts.

Robert
Chote, the chairman of the OBR, warned ministers could be forced to
abandon the ‘triple lock’ which pushes up the value of pensions.

+2

George Osborne’s plans to force future
governments to spend less than they raise in taxes was dealt a blow by
the spending watchdog last night

This
week George Osborne announced his intention to pass a legal requirement
to run budget surpluses under ‘normal’ economic circumstances.

In
his Mansion House speech he claimed the law would ‘move Britain from
crisis and recovery, and towards a new settlement of responsibility and
prosperity’.

But
in a report yesterday, OBR warned that without further cuts, the
government would quickly go back into the red in the coming decades
because of extra costs linked to older people.

As
a result of the lock, the basic State pension rises every year by
inflation, 2.5 per cent or average earnings, whichever is higher.

Mr
Chote said the lock puts ‘systematic upward pressure on pensions
spending’ and ministers might have to make ‘choices’ about the policy in
future.

Tens
of billions more of further cuts or tax rises will be needed to keep
spending levels below taxation revenues and ‘stabilise’ Britain’s
mountain of debt, the OBR said.

It
said the deficit – which ministers have said they will eliminate by the
end of the decade - could reappear as soon as 2023 without further cuts
or tax rises.

It
predicts that in the next half century, health spending will rise by
one third, the state pension by one quarter and the cost of social care
by two thirds.

Overall,
spending on people over 65 is likely to rise to one in every four
pounds spent by the government, from less than one in five today.

Mr
Chote told The BBC’s World at One that the ageing population ‘puts
upward pressure on things like spending on state pensions on health care
on long term care.

+2

Robert Chote (above), the chairman of
the OBR, warned ministers could be forced to abandon the ‘triple lock’
which pushes up the value of pensions

‘You’ve
got some things going in the opposite direction the cost public service
pensions, but overall the public finances do come under pressure as the
population ages.

He
added: ‘Our working assumption based on what’s happened in the past is
the triple lock does put systematic upward pressure on pension spending
as a share of GDP and that creates choices about that but also whether
you might want to make savings elsewhere.’

The
public finances will also be hit by declining North Sea oil revenues
which will now result in revenues of just £2billion to the Exchequer
instead of its previous prediction of more than £35billion in the two
decades from 2020.

Overall debt stands at around £1.48trillion or 80 per cent of GDP – or £55,600 for every UK household.

Michael
Johnson, of the Centre for Policy Studies (CPS), said an ageing
population, coupled with ‘wretched’ unfunded promises such as the triple
lock on State pensions would make it difficult for the Chancellor to
achieve a surplus.

He
said the ‘vast mountain of unfunded promises’, particularly those aimed
at older voters over the next 30 to 40 years, would make it hard to
significantly reduce the deficit.

Mr Johnson said: ‘The issues around the ageing population simply will not go away.

‘The situation will get worse because there will be more pensioners but also relatively fewer workers paying tax.

‘If
the Government is going to get there [and achieve a surplus] they will
have to target the lowest hanging fruit on the Whitehall tree and curb
incentives for saving into a pension, including pension tax relief.’

He also criticised ‘farcical’ benefits for the elderly including free bus travel for all and the £10 Christmas bonus.

Angus
Hanton, of the Intergenerational Foundation said: ‘Stopping the
build-up of national debt is the least we can do for future generations,
but the cutbacks needed for this should fall fairly across the
generations.

‘We
fear the cuts will fall disproportionately on younger generations while
older, wealthier generations continue to be left unscathed and
over-protected by the triple lock on pensions and generous pensioner
perks such as winter fuel payments and pensioner bonds.’

Worked all your life and then they put up the retirement age. Now they don't want to pay your pensions. The white British people have worked and paid for this 'affluent' Britain. But the whole swathe of foreigners that have been let into Britain, from the four corners of the globe and their hordes of children by the zionists, have made the UK into this nightmare multi-racial mess. We are so fractured now in the UK , that a 'fightback' against this tyranny is nigh impossible. We guess that was 'their' plan all along.